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We also provide services during the post-approval phase, including bioequivalence studies of new formulations, line extensions, new disease indications and drug interaction studies. Our ability to offer GMP electrochemical detection services has provided increased business opportunities for release testing.

Increases in our services offerings have resulted in our ability to provide a broader range of services to our clients, often using combined services of several disciplines to address program needs. Our ability to solve problems by combining our knowledge base, services and products has been a factor in our selection by small startup biotechnology companies and major pharmaceutical companies to assist in several preclinical through post-approval phases.

Company Services and Products

Overview

We focus on developing innovative services and products that increase efficiency and reduce costs associated with taking new drugs to market. We operate in two business segments – contract research services and research products, both of which address the bioanalytical, nonclinical, and clinical research needs of drug and device developers. Both segments arose out of our expertise in a number of core technologies designed to quantify trace chemicals in complex matrices.

Contract Research Services

The contract research services segment provides screening and pharmacological testing, nonclinical safety testing, formulation development, regulatory compliance and quality control testing. Revenues from the contract research services segment were $22.4$85.8 million for fiscal 2018.2021. The following is a description of the services provided by our contract research services segment:

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Research Products

We focus our products business on expediting preclinical screening of developmental drugs. We compete in small niches of the multibillion-dollar analytical instrument industry. The products business targets unique niches in life science research. We design, develop, manufacture and market state-of-the-art:

Revenues for our products segment were $3.9$3.8 million for fiscal 2018.2021. We offer two (2) principal product lines: Analytical Products and In vivo Sampling Products. The following is a brief description of the products offered:

Customers

Clients

We have regularly providedprovide our services and/or products to most ofcompanies engaged in pharmaceutical R&D. In fiscal 2021 we had sales to over 350 companies, ranging from emerging biopharmaceutical companies up to the top 25largest pharmaceutical companies in the world, as ranked by the number of researchworld. Approximately 4.7% and development projects. Approximately 15%6.7% of our revenuessales were generated from customersclients outside of North America in fiscal 20182021 and 2017,2020, respectively.

Repeat business from existing clients is important to ongoing operations. Our clients’ needs for our services increase and decrease depending on their research activities, so we experience some client turnover. Our business development efforts focus on generating client loyalty and also on the acquisition of new clients. In fiscal 2018 our Services group continued its presence at several important existing customers. In fiscal 2018,2021, one customerclient accounted for approximately 11.2%6.7% of total sales and 4.0%3.0% of total trade accounts receivable at September 30, 2018.2021. In fiscal 20172020 this customerclient accounted for approximately 13.1%7.0% of total sales and 5.2%3.9% of total trade accounts receivable at September 30, 2017.2020. The customerclient discussed is included in our Services segment. There can be no assurance that our business will move away from dependence upon a limited number of customer relationships.

Sales and Marketing

We promote our services through concentrated business development efforts, scientist-to-scientist communications, and centralized corporate marketing programs and social media to both large and small pharmaceutical and biotechnology medical device

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companies, as well as academic and government research institutions. We recognize that our growth depends upon our ability to continually improve client satisfaction in order to deepen existing, and create new, client relationships.

In November of 2019, the Company rebranded its contract research services business as “Inotiv.” Adoption of the tradename Inotiv symbolized the expansion and supplementation of the Company’s legacy contract research service operations through significant business acquisitions as well as internal growth. Since the rebranding, the Company has marketed and otherwise managed its contract research services operations under the name Inotiv. On March 18, 2021, the Company filed Articles of Amendment to the Company’s Second Amended and Restated Articles of Incorporation, as amended, and amended its Second Amended and Restated Bylaws, as amended, to reflect a corporate name change from Bioanalytical Systems, Inc. to Inotiv, Inc. The research product manufacturing division has continued to operate under the name BASi Research Products. BASi Research Products represents more than 45 years of developing niche instrumentation and supplies for commercial and academic partners in the fields of preclinical drug development, neuropharmacology, and electrochemistry research applications. Research product customers equate the BASi brand with high quality instrumentation and excellent scientific support, and maintaining the BASi name on these products provided trust and continuity.

Our sales and global marketingcommercial initiatives include integrated campaigns designed to help differentiate and promote our products and services. Through trade events, onlinedigital and print advertising, in trade publications, direct communication, newsletters, social media, virtual exhibit space and our website, we provide our perspective on current industry challenges and developments to create an ongoing dialogue with our customersclients and to promote our industry expertise, quality, technology and innovation. We reinforceHistorically, we have reinforced key messages and selling points through client visits, presentations, corporate material and at trade events and industry conferences.

conferences, although our participation at in-person events has been limited in fiscal 2021 as a result of the COVID-19 pandemic.

We encourage and sponsor the participation of our scientific and technical personnel in a variety of professional endeavors, including via in-person and virtual speaking engagements, the presentation of papers at national and international professional trade meetings and the publication of scientific articles in medical and pharmaceutical journals.journals, although these in-person endeavors were limited in fiscal 2021 as a result of the COVID-19 pandemic. Through these endeavors we seek to further our reputation for professional excellence.

As of September 30, 2018,2021, in addition to our leadership team and scientists, we had 1122 employees on our globalcommercial team supporting sales, marketing, client experience and marketing staff focused on bothprogram management for our Services and Products business segments. Weservices clients. To promote our products, we have a network of 1620 established distributors covering Japan, the Pacific Basin,South Korea, China, India, Central America, South America, South Africa, the Middle East India, South Africa and Eastern Europe. All of our distributor relationships are managed from our corporate headquarters in West Lafayette, Indiana.

Lafayette.

Contractual Arrangements

Our service contracts typically establish an estimated fee to be paid for identified services. In most cases, some percentage of the contract costs is paid in advance. While we are performing a contract, customersclients often adjust the scope of services to be provided based on interim project results. Fees are adjusted accordingly. Generally, our fee-for-service contracts are terminable by the customerclient upon written notice of 30 days or less for a variety of reasons, including the customer'sclient’s decision to forego a particular study, the failure of product prototypes to satisfy safety requirements, and unexpected or undesired results of product testing. Cancellation or delay of ongoing contracts may result in fluctuations in our quarterly and annual results. We are generally able to recover, at minimum, our invested costs when contracts are terminated.

Our products business offers both annual and multi-year service and maintenance agreements on many of our product lines.

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Competition

Services

Services

We compete with in-houseinternal research and development quality control and other support service departments of pharmaceutical and biotechnologyteams at our client companies, as well as other Contract Research Organizations ("CROs") that competeCROs in this industry. Several of our competitors have significantly greater financial resources than we do. The largest CRO competitors offering similar research services include:

CROs generally compete on:

Products

Though many global analytical instruments competitors exist, we have a long-standing network of customersclients who are repeat buyers and recommend our products. In contrast, there are few competitors for ourin vivo sampling products. The primaryelectrochemistry market is highly competitive and includes a large pharmaceutical research departmentsnumber of alternative potentiostat vendors, some offering specialized instruments for specific applications. There are fewer vendors that offer the same variety and academic research institutions.quality of consumable items (electrodes). Our differentiators are high quality, flexibility to meet customers’clients’ specific needs, wide variety of supporting products and superior technical support and service.

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The most common competitors for our analytical products include:

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The vendors typically compete on

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In contrast, there are few competitors for our in vivo sampling products. The most common competitor is alternative technologies. The primary market includes large pharmaceutical research departments and academic research institutions that may have a larger portfolio of products, which may lead to a deficit of knowledgeable technical support. Our differentiators are high quality, flexibility to meet clients’ specific needs and superior technical support and service. We provide equipment that enables our customersclients to attain premium scientific laboratory information on a reasonable operating investment. As customers’clients’ needs constantly change, we continually refine our products and develop new products which meet our operating objectives.

Competitors for our in vivo sampling products include:

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The vendors typically compete on

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Government Regulation

The Company is subject to various federal, state, and local laws and regulations and inspections designed to promote compliance therewith. We strive to conduct our business in compliance with applicable laws and regulations. Violations of these laws and regulations by CROs may result in sanctions, including substantial fines, warning letters that require corrective action (including potential facilities improvement requirements), revocation of approvals, exclusion from future participation in government healthcare programs, criminal prosecution and even the denial of the right to conduct business. The Company holds a range of permits and licenses, related to its activities.

We are subject to variousextensive regulatory requirements designed to ensure the quality and integrity of our data and products.products and to government inspections and audits related thereto. These regulations areinclude those promulgated primarily under the Federal Food, Drug and Cosmetic Act, as amended from time to time, and include Good Laboratory Practice ("GLP"), Good Manufacturing Practice ("GMP"), Bioequivalence regulations (“BE”) and Good Clinical PracticePractices ("GCP") guidelines administered by the FDA. The standards of GLP, GMP, BE and GCP are required by the FDA and by similar regulatory authorities around the world.. These requirements demand rigorous attention to research; development; safety; manufacturing quality control; employee training; detailed documentation; equipment and computer validation; promotion and advertising; careful tracking of changes and routine auditing of compliance. Noncompliance with these standards could result in disqualification of project data collected by the Company. Material violations of GLP, GMP, BE or GCP regulations could result in regulatory sanctionsCompany, which would substantially impact our ability to meet our obligations to clients, and, in severe cases, could also result in a discontinuance of selected operations. The products and services we offer to international clients are also subject to foreign regulatory requirements, which vary from country to country. Since our formation, we have been inspected, on a routine basis, by the FDA seventeen times. The FDA has inspectedat each of our West Lafayette location fourteen times and our Evansville location six times. Of the twenty FDA inspections, thirteen were without findings.  Where the FDA had findings, which have not been significant to our operations, we have taken actions to address the findings and the FDA has informed us that it deemed the actions taken as acceptable.locations.

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We are also subject to federal, state and requiredforeign healthcare and other regulations, including anti-bribery and anti-corruption laws (such as the U.S. Foreign Corrupt Practices Act of 1977), and could face substantial penalties if we fail to comply with such regulations fromand laws. In particular, the relationships that we, and third parties that market and/or sell our products, have with purchasers of our products, are subject to scrutiny under various state and federal laws, including those referred to collectively as healthcare fraud and abuse laws.

The Company’s facilities and operations are subject to various federal, state, and local laws and regulations relating to protection of human health and the environment, including those governing the discharge of pollutants into the environment and the storage, handling, use, treatment, disposal, and recycling of hazardous substances and wastes, as further described below. Such laws include, without limitation, the Clean Air Act, the Clean Water Act, the Toxic Substances Control Act, and the Resource, Conservation, and Recovery Act. As environmental laws and regulations continue to evolve, it is likely the Company will be subject to increasingly stringent environmental standards in the future, particularly under air and water quality laws and standards related to climate change issues. Environmental Protection Agency (“EPA”). The EPA has inspected the West Lafayette location twice. Both inspections ended without findings.

Welaws are complex, change frequently and have not experienced any significant problemstended to date in complying with the regulations of the FDA and EPA and do not believe that any existing or proposed regulations will require material capital expenditures or changes in our method of operation.become increasingly stringent over time.

Analytical Services

Laboratories that provide information included in INDs, NDAs and BLAs must conform to regulatory requirements that are designed to ensure the quality and integrity of the testing process. Most of our contract research services are subject to government standards for laboratory practices that are embodied in regulations for GLP, GMP, BE and GCP. The FDA, EPAEnvironmental Protection Agency and other regulatory authorities require that test results submitted to such authorities be based on studies conducted in accordance with the regulations listed above. These requirements include but are not restricted to the following areas:

We must also maintain reports for each study for specified periods for auditing by the study sponsor and by the FDA or similar regulatory authorities in other parts of the world. Regulatory monitoring authorities such as the FDA, have indicated an increased emphasis on the management of electronic records generated by computerized systems to ensure data integrity. Noncompliance with these regulations can result in the disqualification of data collected during the preclinical trial.

Nonclinical Services

Our animal research facilities are subject to a variety of federal and state laws and regulations, including The Animal Welfare Act and the rules and regulations enforced by the United States Department of Agriculture ("USDA") and the National Institutes of Health ("NIH"). These regulations establish the standards for the humane treatment, care and handling of animals by dealers and research facilities. Our animal research facilities maintain detailed standard operating procedures and other documentation necessary to comply with applicable regulations for the humane treatment of the animals in our custody. If the USDA determines that our equipment, facilities, laboratories or processes do not comply with applicable Animal Welfare Act standards, it may issue an inspection report documenting the deficiencies and setting deadlines for any required corrective actions. For continued noncompliance, the USDA may impose fines, suspend and/or revoke animal research licenses or confiscate research animals. In addition to being licensed by the USDA as a research facility, we are also accredited by the Association for Assessment and Accreditation of Laboratory Animal Care International and have registered assurance with the NIH.

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Quality Assurance and Information Technology

To ensurepromote compliance with applicable regulations, we have established quality assurance programs at our facilities, which include auditing of test data, personnel training, review of procedures and regular inspection of facilities. Regulatory guidelines serve as a basis for our Standard Operating Procedures (“SOPs”) where applicable. On an ongoing basis, we endeavor to standardize SOPs across all relevant operations. We have both developed and purchased software to ensure compliant documentation, handling and reporting of laboratory-generated study data.

We adhere to 21 CFR Part 11 (FDA regulations on electronic records and electronic signatures that define the criteria under which electronic records and electronic signatures are considered to be trustworthy, reliable and equivalent to paper records). Our contract research operations were compliant with applicable U.S. FDA regulations (including 21 CFR Part 11) in our analytical, bioanalytical, toxicology, laboratory information management, and document management systems. Systems compliant with 21 CFR Part 11 were formally validated and released for use in regulated studies.

We manage our business systems through the use of an Enterprise Resource Planning ("ERP") system. We are continually refining and adjusting our ERP system to improve efficiency, provide better management tools and address changes in our business. These changes are appropriately documented and tested before implementation. We also test these systems in connection with management’s annual review of our internal control systems. Management’s assessment and report on disclosure controls and procedures and internal controls over financial reporting is included in Item 9A.

Controlled, Hazardous, and Environmentally Threatening Substances

Some of our development and testing activities are subject to the Controlled Substances Act administered by the Drug Enforcement Agency ("DEA"), which strictly regulates all narcotic and habit-forming substances. We maintain restricted-access facilities and heightened control procedures for projects involving such substances due to the level of security and other controls required by the DEA. In addition, we are subject to other federal and state regulations concerning such matters as occupational safety and health and protection of the environment.

Our laboratories are subject to licensing and regulation under federal, state and local laws relating to hazard communication and employee right-to-know regulations, the handling and disposal of medical specimens and hazardous waste, as well as the safety and health of laboratory employees. All of our laboratories are subject to applicable federal and state laws and regulations relating to the storage and disposal of laboratory specimens, including regulations of the Environmental Protection Agency, the Department of Transportation, the National Fire Protection Agency and the Resource Conservation and Recovery Act. Although we believe that weThe Company may incur liability for alleged environmental damages associated with the off-site transportation and disposal of hazardous substances. Generators of hazardous substances which are currently in compliance in all material respects with such federal,transported to disposal sites where environmental problems are alleged to exist are subject to claims under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, or CERCLA, and state counterparts. CERCLA Imposes strict, joint and local laws, failure to comply could subject us to denial of the right to conduct business, fines, criminal penaltiesseveral liabilities for investigatory and cleanup costs upon hazardous substance generators, site owners and operators, and other enforcement actions.

potentially responsible parties. The Company may be held liable for all costs arising out of any release of hazardous substances and for consequences arising out of human exposure to such substances, which costs may be material. In addition, changes in any environmental laws may increase costs of compliance and liabilities arising from any past or future releases of, or exposures to, hazardous substances and may materially adversely affect the business.

The regulations of the U.S. Department of Transportation, the U.S. Public Health Service and the U.S. Postal Service apply to the surface and air transportation of laboratory specimens. Our laboratories must also comply with the International Air Transport Association regulations which govern international shipments of laboratory specimens. Furthermore, when materials are sent to a foreign country, the transportation of such materials becomes subject to the laws, rules and regulations of such foreign country.

Safety

Safety

In addition to comprehensive regulation of safety in the workplace generally, the Occupational Safety and Health Administration has established extensive requirements relating to workplace safety for health care employers, whose workers may be exposed to blood-borne pathogens such as HIV and the hepatitis B virus.virus, chemicals and drugs, and

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respiratory hazards. These regulations, among other things, require work practice controls, protective clothing and equipment, training, medical follow-up, vaccinations and other measures designed to minimize exposure to chemicals, and transmission of blood-borne and airborne pathogens.pathogens, and other potential hazards. Relevant employees receive initial and periodic training focusing on compliance with applicable hazardous materials regulations and health and safety guidelines.

HIPAA

HIPAA

Under the Health Insurance Portability and Accountability Act of 1996 ("HIPAA"), the U.S. Department of Health and Human Services regulates the disclosure of confidential medical information in the United States. We have had a global privacy policy in place since January 2001 and believe that we are in compliance with HIPAA and current European Union requirements regarding confidential medical information. We continue to monitor our compliance with these regulations, and we intend to take appropriate steps to promote compliance as these and other privacy regulations are revised or additional regulations come into effect.

Product Liability and Insurance

We maintain product liability and professional errors and omissions liability insurance, providing coverage on a claims-made basis. Additionally, in certain circumstances, we seek to manage our liability risk through contractual provisions to be indemnified by the customerclient or covered by the customer’sclient’s liability insurance policies. Also, in certain types of engagements, we seek to limit our contractual liability to customersclients to the amount of fees received. Our customerclient contractual arrangements are subject to negotiation, and the terms and scope of indemnification, liability limitation and insurance coverage vary by customerclient and project.

Research and Development

In fiscal 20182021 and 2017,2020, we spent $596$405 and $465,$617, respectively, on research and development. Separate from ourIn addition to research and development for additional contract research services, business, we maintain applications research and development to enhance our products business. Expenditures cover hardware and software engineering costs, laboratory supplies, labor, prototype development and laboratory demonstrations of new products and applications for those products.

Intellectual Property

We believe that our patents, trademarks, copyrights and other proprietary rights are important to our business. Accordingly, we actively seek protection for those rights both in the United States and abroad. Where we deem it to be an appropriate course of action, we will vigorously prosecute patent infringements. The loss of any one or more of our patents, trademarks, copyrights or other proprietary rights could be material to our consolidated revenues or earnings.

We currently hold fourthree U.S. federally registered trademarks. We also have two issued U.S. patents on the Dried Blood Spot (DBS) sampling card for theCulex® Automated Blood Sampling Instrumentation.There are also pendingtwelve issued international patent applicationspatents for this technology in Japan, Canada, Europe, Belgium, Switzerland, Germany, Spain, France, the United Kingdom, Italy, Netherlands, and Europe.Sweden. Additionally, we have three issued U.S. patents for the No Blood WasteEmpis Automated Drug Infusion technology for theCulex® instrument. There are thirteenfourteen issued international patents for this technology in Europe, Japan, Canada, Belgium, Switzerland, Germany, Denmark, Spain, France, the United Kingdom, Hungary, Ireland, Sweden, and Canada.Turkey. There are twois one additional issued U.S. patentspatent and fifteenthirteen issued international patents in Belgium, Canada, Switzerland, Germany, Denmark, Europe, Spain, France, Great Britain,The United Kingdom, Italy, Japan, Sweden,Netherlands and SwitzerlandSweden relating to the Raturn®No Blood Waste technology which can be used withfor theCulex® system; twoinstrument. There is also one issued U.S. patents and one issued Canadian patent relating to pinch valve technology; and thirteen pending international patent applications in Canada, Japan and Europe relating to a tube assembly system that could potentially be used in theCulex® system.

technology.

Our issued patents are protected for durations ranging from OctoberJune of 20182022 to AugustFebruary of 2037.2034. In addition to these formal intellectual property rights, we rely on trade secrets, unpatented know-how and continuing applications research which we seek to protect through means of reasonable business procedures, such as confidentiality agreements.

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Raw Materials

There are no specialized raw materials that are particularly essential to our business. We have a variety of alternative suppliers for the components in our products.

Employees

Human Capital Management

At September 30, 2018,2021, we had 224541 full-time employees and 1126 part-time employees. All employees enter into confidentiality agreements intended to protect our proprietary information. We believe that our relations with our employees are good. None of our employees are represented by a labor union. Our performance depends on our ability to attract and retain qualified professional, scientific and technical staff. The level of competition among employers for skilled personnel is high. We believe that our employee benefit plans enhance employee morale, professional commitment and work productivity and provide an incentive for employees to remain with the Company.

Our primary objectives and philosophy of our compensation programs are to (i) drive leadership behaviors that maximize long-term stockholder value creation, (ii) attract and retain talented colleagues with the skills necessary to successfully manage and grow our business.    

Attracting, retaining, and developing talent is a core principle of our talent management and total rewards strategy. Compensation and benefit programs are an important part of our employment relationship, which also includes challenging and rewarding work, growth and career development opportunities and being part of a leading contract research organization with a diverse and talented workforce that helps develop life-changing therapies. We strive to have the following features as part of our compensation and benefits:

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Compensation will be used to attract, retain, and motivate employees and to reward the achievement of business results through the delivery of competitive pay and discretionary incentive programs. Benefits provide employees with income security and protection from catastrophic loss. We will continue to evaluate and develop affordable, competitive benefit programs that meet these objectives. No one element is more important than any other, and business judgement is used to balance them to ensure our compensation and benefits strategy are effective in supporting our overall business strategy.

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Our Guiding Principle’s consist of:

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Attracting, retaining, and developing world class talent that is empowered to work together to compete and win is a fundamental aspect of our corporate strategy. A foundational principle of our talent management strategy is an

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unwavering commitment to equal opportunity in all aspects of employment, including the way we compensate and reward our employees.

Envigo Business

We entered into a Merger Agreement with Envigo on September 21, 2021 and completed the Envigo Acquisition on November 5, 2021. Following completion of the Envigo Acquisition, Envigo is a direct, wholly owned subsidiary of Inotiv, Inc. In order to provide our shareholders and other investors with information that is relevant to our business, we are providing a description of Envigo's business below. References in this discussion to "Envigo" include Envigo and its direct and indirect subsidiaries.

Overview

Envigo is primarily a products business that provides research-quality animals for use in laboratory tests, as well as standard and custom laboratory animal diets and bedding and other associated services for contract research organizations, biopharmaceutical companies, universities, governments and other research organizations. Envigo provides our customers with laboratory animals used in basic research and product development and non-clinical testing of compounds to support the development and approval of new medicines. Utilizing its portfolio of products, Envigo enables our customers to create a more flexible product development model and reduce their costs, enhance their productivity, and increase speed to market. Envigo's vision, working together to build a healthier and safer world, includes helping our customers meet certain regulatory requirements in order to bring life-saving and life-enhancing new medicines to patients.

Envigo is the second largest commercial provider of research model products and services globally and has been supplying research models since 1931. With over 130 different strains, Envigo is a global leader in the production and sale of the most widely used rodent research model strains, and is able to offer the broadest range of species in our sector. Envigo also manufactures and sells premium Teklad brand diets for laboratory animals and provides a variety of related services that are designed to assist our clients in the use of animal models in research and development. Envigo maintains production centers, including barrier and isolator facilities, in the U.S., U.K., mainland Europe, and Israel.

Envigo's Market

The market for Envigo's services includes contract research organizations, biopharmaceutical companies, universities, governments and other research organizations.

Envigo offers a broad range of research-quality small and large animal models, research-quality standard and custom diets, as well as an associated suite of services to support the research community. Envigo's portfolio of products and services provides our customers vital support in their efforts to perform fundamental life sciences research, as well as developing life-saving and life-enhancing new medicines.

We believe that Envigo is well positioned to benefit from the following market trends:

Increased Research & Development (“R&D”) spending by biopharmaceutical companies. As reported by Frost and Sullivan, the non-clinical market is expected to grow at a compounded annual growth rate of approximately 7% to reach an estimated $24 billion by 2026. Drivers of this growth include the increased complexity of studies required by global drug regulators to better predict safety and efficacy of compounds in development, and growth in personalized medicine leading to more targets for discovery and safety assessment work.

Demand for NHPs. Since their inception in the 1980’s, biological therapies, such as monoclonal antibodies, have been growing in importance as powerful new tools to manage and treat disease and, as such, have represented an increasing proportion of novel drugs in development. For many biotherapeutics, the ability to assess safety, which is a vital step in the development and approval of a new medicine, is critically dependent upon the ability of the potential drug to bind to its target receptor in the model organism. The closest animal model to a human is the non-human primate, and in many cases, this is the only species in which these developing medicines will bind. We believe the trend for increasing numbers of new biological therapies will continue and drive additional demand for NHPs. As the largest importer of NHPs in North America, with long-established relationships with the source breeders around the world, Envigo is favorably positioned for this trend.

Increasing research complexity and specificity. Over recent years, searching for new therapies has become increasingly complex and specific as our understanding of disease mechanisms and pathways has increased.

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Researchers have increasingly looked for specific ways to interact with the molecular pathways during disease development and progression. This has led to increasing demand for animal models that not only have those same, or similar, pathways, but models that have been altered so that, for example, critical elements of those pathways have been removed or replaced with the human versions. The ability to generate these altered animals relies on molecular tools that can alter the DNA of the animal to achieve the desired model, a so-called ‘transgenic’ animal model. These modified models are becoming increasingly important tools for researchers to better understand disease progression and pathology, and then to develop more highly-targeted therapies.

Envigo's Role in Drug Development

Envigo offers products and services that are critical to drug discovery, development and registration. Discovering and developing new drugs is an expensive and time-consuming process and is highly regulated. Before a new drug reaches commercialization, it must undergo extensive non-clinical and clinical testing to verify that it is safe and effective.

Drug discovery represents the earliest stages of research in new drug development, directed at the identification, screening, and selection of lead molecules for further development. During this stage, new molecules are tested for therapeutic value using various in silico, in vitro and in vivo models. Discovery activities typically extend anywhere from three to six years.

Envigo's laboratory animals and research models are extensively used by academic research centers, government agencies and biopharmaceutical companies engaged in drug discovery. In addition, the Food and Drug Administration (“FDA”) and other regulatory agencies require that the safety and efficacy of new drug candidates be tested in research models like Envigo's prior to product registration. As a result, Envigo's research models are an essential part of the drug research and development process.

Envigo is unique in being the only provider that can supply the whole range of animal model species that regulatory agencies, such as the FDA, require for the safety assessment of both small chemical and biological new drugs.

Research Models and Services (“RMS”)

Envigo's RMS business is comprised of (1) Research Models, (2) Diets and Bedding, and (3) Research Model Services.

Research Models. Envigo's research models business is comprised of the commercial production and sale of laboratory animals and research models, principally purpose-bred rats and mice and large animal models (NHPs, canines and rabbits) for use by researchers. Envigo provides these models to numerous customers around the world, including many academic institutions, government agencies, biopharmaceutical companies, and contract research organizations. Envigo has a global footprint with production facilities strategically located in six countries. Envigo's operations are located in close proximity to our customers, enabling it to provide top-tier customer service with a high degree of animal welfare.

Envigo's research models include standard stocks and strains, immunocompromised models (which are useful for oncology research), disease models (which are in demand as early-stage research tools) and genetically-engineered models (“GEMs”, which are often created for specific research projects).

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Small Animal Research Models. Envigo's rodent species have been, and continue to be, some of the most extensively used research models in the world, largely as a result of Envigo's geographic footprint and commitment to quality and customer service. Envigo's products create high customer loyalty, due to the strong preference of customers to avoid variability in their data and to work with an industry founder with more than 90 years of experience. Envigo's small animal research models are bred and maintained in controlled environments, which are designed to ensure that the models are free of specific viral and bacterial agents, and other contaminants that can disrupt research operations and distort research results. With its production capabilities, Envigo strives to consistently deliver high-quality research models worldwide.

Envigo's rodent research models include:

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Certain of Envigo's models are proprietary, disease-specific rodent models used to research treatments for diseases such as diabetes, obesity, cardiovascular and kidney disease.

Large Research Models. Envigo's large animal portfolio includes NHPs, canines and rabbits. NHPs are generally imported into the U.S. from Asia and Africa, with very limited breeding in the U.S. Envigo operates a large quarantine facility in the U.S. to house and clear these imported animals, ensuring they have high health status before onward shipment to customers. NHPs are used by our customers primarily for the safety testing of new biological therapies. Canines are purpose-bred in the U.S. and used primarily for the safety testing of new chemical therapies. Rabbits are bred in both the U.K. and U.S. and utilized primarily for the reproductive safety testing of potential new therapies.

Diets and Bedding. Through its Teklad product line, Envigo produces and sells laboratory animal diets, bedding, and enrichment products. With primary manufacturing operations in the U.S. and a primarily company-owned and/or managed distribution network throughout the U.S., U.K. and Europe, Envigo distributes Teklad products globally. Envigo also maintains contract-manufacturing relationships with companies in the U.K. and Italy. In October 2019, Envigo RMS, LLC (“Envigo U.S.”) entered into a master services agreement with Vanguard Supply Chain Solutions LLC (“Vanguard”) to provide transportation and warehousing services for its operations in the U.S. and Canada for research models and Teklad products. Prior to this agreement, Envigo had utilized internal resources to transport its research models and large laboratory animals, and transport and warehouse its Teklad products in those geographies.

Teklad has been manufacturing animal diets for over 40 years and offers a full line of off-the-shelf formulations as well as custom diets to meet our customers’ specific research needs. A team of nutritionists, including several PhD’s, works with our customers to determine the best diet for their research objectives. If a custom diet is required, our nutritionists define the appropriate formula and our custom diet manufacturing line produces the feed. Our manufacturing facilities are ISO 9001:2008 certified.

Teklad diets are manufactured from natural ingredients and use fixed formulas. In conjunction with strict quality standards for raw materials, this approach ensures quality and consistency by minimizing variability of both nutrients and certain natural chemicals in the diet which might affect a research study. Teklad offers a variety of bedding and enrichment products to support model breeding, weaning, and holding.

Research Model Services. Envigo also offer a variety of services designed to support our customers' use of research models in basic research and product development. These services include specialized surgical modifications such as cannulation, implants, and the creation of surgically derived disease state models. Envigo also provides contract breeding, contract colony management, health monitoring, quarantine, cryopreservation, rederivation and revitalization services, as well as antibody development and production. In addition, Envigo offers care and boarding services for customer-owned animals at its facilities. Lastly, through the Envigo GEMS business, Envigo is able to offer the creation of new transgenic research models specific to individual customers’ needs.

Envigo's Competitive Strengths

We believe that Envigo is well positioned to capitalize on favorable trends in the research industry and provide differentiated solutions to our customers based on the key competitive strengths set forth below:

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Envigo's Growth Strategy

Envigo's objective is to be a preferred strategic partner for our customers. Envigo's strategy is to deliver a comprehensive portfolio of research model products and services to support our customers’ research and development requirements, and enable them to conduct essential research faster and more cost effectively.

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Customers

Envigo's customers consist primarily of biopharmaceutical, contract research organizations, leading hospitals, academic institutions and government agencies. In 2020, Envigo received orders from companies ranging from some of the largest in their respective industries to small, start-up organizations. Envigo has stable, long-term relationships with many of our customers. During the twelve months ended September 30, 2021, one customer accounted for 31% of Envigo's total revenue from continuing operations.

During the twelve months ending September 30, 2021, Envigo derived 46% our revenue from CROs, 23% from academic institutions, 16% from biopharmaceutical companies, 7% from government institutions and 8% from other organizations.

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Envigo continues to pursue a goal of expanding its relationships with customers through broadening its product and service offering.

Sales, Marketing and Customer Support

Envigo sells its products and services principally through a direct sales force, inside sales team and account management teams who work throughout North America and Europe. In addition to interactions with the direct sales force, our primary promotional activities include a marketing mix of customer acquisition and customer retention tactics including organizing scientific symposia, publishing scientific papers and newsletters, hosting webinars and making presentations at, and participating in scientific conferences and trade shows in North America, Europe and Asia. Envigo supplements these scientifically-based marketing activities with internet-based marketing, advertising and direct mail.

Envigo has proven sales teams with the ability to build relationships with new customers and to grow within existing customers.

Envigo's internal marketing teams support the field sales staff and account management teams while developing and implementing programs to create close working relationships with our customers in the research community. Envigo maintains customer service, technical assistance and consulting service departments, which address our customers' routine and more specialized needs and serve as a scientific resource for them. Envigo frequently assists customers in solving problems related to animal husbandry, health and genetics, biosecurity, regulatory strategy, and other areas.

Competition

Competition in Envigo's market segments includes:

There is competition for customers on the basis of many factors, including scientific and technological expertise, quality, reputation, responsiveness, price, scope of product and related service offerings, and geographic presence.

We believe there are significant barriers to becoming a global provider including the construction of bio-secure barrier production facilities, flexible-film isolator production facilities and the population of these facilities with over 130 strains of animal models requires years of investment and strict operating procedures.

Industry Support and Animal Welfare

Envigo is committed to delivering first-class health and genetic quality, operational performance and customer service. High standards of animal welfare are vital to each of these, and so are integral to Envigo's business success.

Envigo has been at the forefront of animal welfare improvements and the humane care of laboratory animals. Envigo is a leading advocate for implementation of the 3Rs (Replacement, Reduction and Refinement). Members of Envigo's scientific and technical care staff undertake continuing professional development in the field of laboratory animal science, with special focus to animal welfare and the 3Rs, and they are encouraged to publish and present within the scientific community.

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Envigo has formed an internal Institutional Animal Care and Use Committee, comprising staff from many disciplines within Envigo, in addition to external representation, to comply with applicable regulations and provide strict oversight of animal welfare matters. Envigo's animal production facilities in the U.S. and the Netherlands, are accredited by the Association for Assessment and Accreditation of Laboratory Animal Care International (“AAALAC”), a private, non-profit, international accrediting organization that promotes the humane treatment of animals in science through voluntary accreditation and assessment programs. Envigo's facilities are routinely inspected by government agencies tasked with enforcing animal welfare regulations.

Envigo is firmly committed to the 3Rs and to reducing the number of animals used in research by emphasizing health and genetic integrity to decrease study data variability. Whenever possible, Envigo uses technological advances, such as new diagnostic tests for screening pathogens in laboratory rodents, micro-sampling and in vitro assays.

Laboratory animals remain an essential component in the research and development that our customers conduct. They further our knowledge of living systems and help in the discovery and development of products that can save or enhance people’s lives. Envigo works with the scientific community to improve our understanding and promote best practice in the care and welfare of research animals. As providers of research models to the research community, Envigo is responsible to our customers and the public for the health and well-being of the animals in our care.

Environmental, Social and Governance Principles

Envigo endeavors to fully comply with all applicable environmental, social and governance criteria. Envigo's strengths include, among other areas, its dedicated responsibility for environmental issues; its waste management and hazardous substances handling procedures; labor and human rights policies (including employee health and safety); customer protection policies and efforts; and policies on anticorruption and bribery.

Animal Welfare. Envigo maintain policies regarding animal welfare. Given Envigo's line of business, animal welfare is one of its highest priorities, as it is crucially important from both an ethical and a good business practices perspective.

Environmental. Envigo maintains policies regarding appropriate energy use, treatment of waste, and natural resource conservation.

Social. Envigo's business practices stress ethical engagement with suppliers and customers. Envigo has implemented a Suppliers and Contractors Governance Policy. We believe that Envigo provides a crucial, socially important service: safety testing services that are mandated by governments around the world as a crucial step in the discovery and safe development of pharmaceuticals.

Governance. Envigo has adopted and implemented a Global Code of Conduct for all employees and internally promotes an anonymous, third-party whistle-blower hotline (located at envigo.com/integrity). Envigo has put in place stringent anti-corruption and anti-bribery policies and does not participate in any type of political fund raising or political action committee efforts.

Human Capital Resources

As of September 30, 2021, Envigo had approximately 1,200 employees. Envigo's workforce was distributed geographically approximately as follows: 65% in North America and 35% in the rest of the world (primarily UK and Europe).

In addition to growth opportunities, Envigo strives to attract, motivate, and retain top talent by endeavoring to provide competitive compensation levels while rewarding outcomes and behaviors that align with our performance, culture, and values. 2020 marked the first year that Envigo commenced a competitive market compensation philosophy and pay guidelines for all positions in the U.S. and completed the same approach in the U.K. at the end of first quarter of 2021. This deliberate focus elevated Envigo's competitive pay position in the life science industry overall, but more importantly in the local markets in which Envigo conducts business.

Pay equity analyses are performed in countries where they are legally required, and Envigo is embarking on embracing an internal pay equity analysis as part of internal auditing, in an effort to ensure pay fairness and selling, general and administrative oversight. Our assertive position on pay should ensure our continuing efforts to be competitive in the marketplace. Furthermore, Envigo continues to build on a global job architecture that allows for aligning pay by job role (slotting) with market rates and serves as a career path tool to encourage a culture of upward mobility and retention.

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Correspondingly, Envigo also promotes a healthy and safe workplace for its employees. Envigo maintains a Global Policy on Environmental Safety & Health and sustainability and, as part of its efforts to promote its goal of working safely. In the second half of 2019, Envigo implemented a management system approach to complement its safety performance, which involves both employee and management engagement and ownership of its site-level environmental, health, safety, and sustainability programs globally. At every Envigo site, Envigo has dedicated site champions and empowers all employees to act and behave as safety leaders promoting employee health and safety; additionally, Envigo has programs and communications that keep site management engaged in their local health and safety programs. Moreover, the COVID-19 pandemic has further underscored the importance of keeping employees safe and healthy. In response to the pandemic, Envigo has taken actions to protect the workforce so they can more safely and effectively perform their work. Envigo has established a global crisis management team (“ICARE”), which includes a team of internal subject matter experts who have been closely monitoring the COVID-19 outbreak and its impact on employee safety and Envigo's global business operations. As Envigo navigates the pandemic and focuses on keeping people safe, Envigo continues to establish stringent safety protocols at its operating and regional corporate sites. As always, Envigo's goal is to provide a safe work environment for employees, while still meeting our customer’s needs.

Envigo's global and site business continuity plans are comprehensive, active, and regularly updated as Envigo continues to meet requirements for supporting COVID-19 guidelines.

Envigo is also committed to cultivating a welcoming and inclusive environment. Operating in 32 facilities and in eight countries worldwide, Envigo believes in treating its employees and prospective talent with dignity, decency, and respect. Envigo recognizes that the mix of its employees contributes to a more innovative, inclusive and productive workforce and that embracing people of all backgrounds and experiences is a strength for its business. Envigo's goal is to continue to build a talented workforce reflective of the global communities in which we live and work, and it is critical that our people feel like valued members of our company.

Likewise, Envigo believes that it has begun to take positive steps to promote a sense of belonging for its employees in the workplace by building our initiatory DE & I committee (Diversity Equity and Inclusion); expanding diversity representation at our senior level management; and developing a plan to centralize diversity and inclusion resources for all employees. Additionally, this committee will be tasked with facilitating senior leadership training on cultural differences, anti-harassment and anti-discrimination, unconscious bias, and micro-inequities; and rolling out a diverse selection process in collaboration with our talent acquisition team related to hiring.

As of December 1 2021, women made up approximately 55% of Envigo's global workforce and 39% of Envigo's global leadership positions, defined as positions carrying the title of Director to Vice President.

Envigo's employees are not unionized in the U.S. However, employees at some of its European facilities are represented by works councils, which are employee representative groups and/or unions, which is consistent with local customs for our industry. Envigo collaborates with the works councils and believes it has good relationships with our employees.

Properties

Envigo owns or leases the land and buildings where Envigo has facilities to support its RMS operations, including large domestic facilities in California, Indiana, Pennsylvania, Texas, Virginia and Wisconsin, and also in foreign countries including those in the U.K., the Netherlands, France, Spain and Israel. In addition, Envigo leases its corporate headquarters located in Indianapolis, Indiana, as well as some of its smaller operating facilities. Envigo believes its office space and facilities are suitable and adequate to support our current business needs and are appropriately utilized. Many of Envigo's leases have an option to renew, and Envigo believes that it will be able to successfully renew expiring leases on satisfactory terms.

Contractual Arrangements

Generally, Envigo's contracts are short-term in nature and based upon purchase orders submitted for specific customer requirements. Pricing is based upon Envigo's list price which is market-adjusted. In addition, with certain larger customers, Envigo has entered into long­-term supplier agreements. As part of the EGSI acquisition, Envigo entered into a five-year supplier agreement with a key strategic partner that includes minimum purchase commitments and preferred pricing (equal to best price extended to similar customers). Envigo also has a supplier agreement with another large customer that includes discounted pricing.

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Regulatory Matters

As Envigo's business operates in a number of distinct operating environments and in a variety of locations worldwide, Envigo is subject to numerous, and sometimes overlapping, regulatory environments.

The Animal Welfare Act (“AWA”) governs the care and use of certain species of animals used for research in the U.S. other than laboratory rats, mice and birds. For regulated species, the AWA and the associated animal care regulations require producers and users of regulated species to provide veterinary care and to utilize specific husbandry practices such as cage size, shipping conditions, sanitation and environmental enrichment to assure the welfare of these animals. Separately, facilities using live vertebrate animals in research funded by the U.S. Public Health Service (“PHS”) must also adhere to the PHS Policy on Humane Care and Use of Laboratory Animals and follow the Guide for the Care and Use of Laboratory Animals produced by the Institute for Laboratory Animal Research.

Envigo is subject to licensing and registration requirement standards set by the United States Department of Agriculture (“USDA”) and similar agencies in other countries for the care and use of regulated species. Envigo's operations in the Europe follow the standards as stipulated by the Directive 2010/63/EU on the Protection of Animals Used for Scientific Purposes. Stipulations within that Directive were transposed into national legislations within the EU (including the U.K.) in 2013. Envigo is regularly consulted and inspected by the relevant national authorities in order to ensure continued compliance with the legal requirements in each nation in which it operates.

Envigo's import and export of animals and its operations in foreign countries are subject to international agreements and conventions, as well as a variety of national, regional, and local laws and regulations, which establish the standards for the humane treatment, care, handling and transport of animals by dealers and research facilities.

In addition, the specific activities of some of Envigo's businesses require Envigo to hold specialized licenses for the conduct, manufacture, and distribution of particular products and services.

All of Envigo's sites are subject to licensing and regulation under international treaties and conventions, including national, regional and local laws relating to:

To assure these compliance obligations, Envigo has established quality assurance procedures and functions. The quality assurance function operates independently from those individuals that manage RMS production.

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Intellectual Property

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Envigo maintains and protects trade secrets, know-how and other proprietary information regarding many of its business processes and related systems. Although Envigo's intellectual property rights are valuable to its success, Envigo believes that such factors as the technical expertise, proprietary know-how, ability and experience of its staff are more important. Where Envigo consider it appropriate, steps are taken to protect its know-how through confidentiality agreements and registration of title or use. While Envigo has certain trademarks and patents, Envigo has no patents, trademarks, licenses, franchises or concessions which are material and upon which any of its services are dependent.

COVID-19

The outbreak of COVID-19, which the World Health Organization declared in March 2020 to be a pandemic, continues to spread throughout the United States of America and the globe. Many U.S. State Governors issued temporary Executive Orders that, among other stipulations, effectively prohibited in-person work activities for many industries and businesses, having the effect of suspending or severely curtailing operations. The outbreak continued through the Summer 2020 and, after abating somewhat, had a precipitous resurgence in the Fall and Early Winter 2020/2021. During December 2020, upon completion of clinical trials, COVID-19 vaccines received approval from health governing bodies in the U.S. and Europe and a phased inoculation of populations was begun. New variants of the

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COVID-19 virus continue to emerge and one or more may prove able to partially or fully avoid the protective effect of these vaccines and could prove disruptive in the future.

Due to the world-wide impact of the COVID-19 pandemic, our operations have been impacted in many ways including:

Envigo has been able to secure NHPs from other sources in Asia to cover a large portion of NHPs typically sourced from China, but customer demand continues to outpace supply.

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Executive Officers of the Registrant

The following table illustratesprovides information concerning the persons who currently serve as our executive officers. Officers are elected annually at the annual meeting of the board of directors.

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Robert W. Leasure, Jr. joined the Company as President and Chief Executive Officer on January 12, 2019. Mr. Leasure serves as the managing partner and president of LS Associates LLC (“LS”), a management and turnaround firm formed in 2002. From September 2016 until Mr. Leasure’s employment, the Company engaged LS as a financial consultant. Mr. Leasure’s experience working with management teams in areas including strategic planning and implementation, problem solving, operations, mergers and acquisitions and financial transactions, and in particular Mr. Leasure’s experience leading the Company’s turnaround and current growth, well situate him for his role as President and Chief Executive Officer and as a director.

John E. Sagartz, DVM, PhD,Ph.D., DACVP,joined the Company as part of the Company’s acquisition of Seventh Wave Laboratories on July 2, 2018.Following the acquisition, Dr. Sagartz has served as the Company’s Chief Strategy Officer and joined BASi’sInotiv’s Board of Directors to help guide operationsstrategy in order to provide broader solutions and greater scientific expertise to the Company’s clients.Dr. Sagartz began his career as a toxicologic pathologist at Searle/Monsanto

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in 1996, and held positions of increasing responsibility as section head, director, preclinical development site head, and fellow, following Monsanto’s merger with Pharmacia. After Pfizer’s acquisition of Pharmacia in 2003, Dr. Sagartz founded Seventh Wave Laboratories where he served as President and Chief Executive Officer, and Chief Strategy Officer. Dr. Sagartz is an adjunct associate professor of Comparative Medicine at St. Louis University’s College of Medicine and serves on the Board of Directors of the Missouri Biotechnology Association. He received his Bachelor of Science and Doctor of Veterinary Medicine degrees from Kansas State University and, after completing residency training in anatomic pathology, earned his Doctor of Philosophy from The Ohio State University.

Dr. Sagartz has the education and experience to provide strategic insight and industry knowledge to serve as Chief Strategy Officer for the Company and serve as a director.

Jill C. BlumhoffBeth A. Taylor joined the Company as Assistant Controller on October 7, 2007 and thereafter was promoted to positions of greater responsibility in the Accounting and Finance area including Director of Financial Reporting and Director of Finance and IT until reaching her present position of Chief Financial Officer and Vice President of Finance on May 11, 2016. She has been responsible for all aspectsMarch 9, 2020. Prior to joining the Company, Ms. Taylor held financial positions of financial reportingVice President of Finance and disclosureChief Accounting Officer, Corporate Controller and Finance Director positions at Endocyte, Inc., Author Solutions, Inc., Harlan Laboratories, Inc., Republic Airways Holdings and Rolls-Royce Corporation. Ms. Taylor started her career in audit assurance with Deloitte and received a B.S. in Accounting from Kelley School of Business, Indiana University in Bloomington, Indiana.

William D. Pitchford joined the Company as well as leadingChief Human Resources Officer on August 28, 2019. Prior to joining the Company’s efforts in buildingCompany, Mr. Pitchford held senior level positions within the financial support structurehuman resources functions at BASi. Ms. Blumhoff held various roles of increasing levels of responsibility in financial reportingFord Motor Company, Rio Tinto Alcan Corporation and, analysismost recently, at Wabash National Corporation after beginning her careeras Senior Vice President of Human Resources. Mr. Pitchford received his undergraduate degree in Criminology & Sociology at Ernst & Young LLP. Ms. Blumhoff receivedIndiana State University, and his Master of Arts in Human Resources Management at Central Michigan University.

John Gregory Beattie joined the Company in February 2021 as the Chief Operating Officer. Prior to joining the Company, Mr. Beattie held Corporate Vice President positions at Charles River Laboratories, a contract research organization, where he led business units within all three of their segments. In these roles, Mr. Beattie was responsible for driving operational performance. Mr. Beattie holds a Bachelor of Science degree in accountingBiology from McGill University and a Master of Science degree in Experimental Health Sciences from Université du Quebéc, and graduated from the University of the IllinoisKellogg Management Institute program at Urbana-Champaign in 1998.

Northwestern University.

Philip A. Downing has over 2223 years of pharmaceutical experience in drug discovery, toxicology/non-clinical, and clinical research. Traditionally trained as a bioanalytical chemist, Mr. Downing joined BASithe Company as an analytical chemist in 1997, rapidly moving into leadership positions such as Director of Analytical Services, General Manager, and Sr. Director of Preclinical, until reaching his present position as Vice President of Preclinical Services in March of 2015.Services. Prior to joininghis tenure with BASi, Mr. Downing worked at GFi Pharmaceuticals (now Covance Labs – Clinical Division) as an Analytical Scientist, and RSO designing and validating radiolabeled and non-radiolabeled assays used to support clinical ADME studies. Mr. DowningHe earned a Bachelor’s Degree in Chemistry and Biology from Indiana University and is a member of the Society of Toxicology, American College of Toxicology and the American Chemical Society.

Adrian Hardy, Ph. D. joined the Company as Executive Vice President upon the closing of the Envigo Acquisition on November 5, 2021. Dr. Hardy joined Envigo in 2002. He became Chief Executive Officer and President in July 2016 and sole director of Envigo in July 2018. Dr. Hardy initially joined Envigo in a business development role which ultimately included global responsibility for sales, corporate development and strategic marketing. Dr. Hardy was appointed Chief Operating Officer in 2014 with global responsibility for the operations of Envigo. Dr. Hardy has a background in molecular and developmental biology, with a doctorate from University College, London where he also completed his post-doctoral research. After leaving academia, Dr. Hardy spent three years working in product development for a subsidiary of Novartis and a further two years running his own business.

James Harkness joined the Company as Chief Operating Officer – Research Models & Services upon the closing of the Envigo Acquisition on November 5, 2021. Mr. Harkness joined Envigo in June 2019 as its Chief Operating Officer. Prior to joining Envigo, Mr. Harkness has over 25 years of CRO experience leading global operations, supply chain and customer facing teams in both late stage and preclinical businesses. Mr. Harkness served as the Vice President of Early Development Operations for LabCorp (previously Covance) from 2015-2018. Mr. Harkness obtained his Master of Business Administration from Ohio State University in 2010.

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Michael Garrett joined the Company as Chief Commercial Officer upon the closing of the Envigo Acquisition on November 5, 2021. Mr. Garrett served as Senior Vice President of Commercial for Envigo since June 2019, having joined the company in 2018 as Head of Service Development. Prior to joining Envigo, he was Vice President of Commercial for MPI Research, a non-clinical contract research organization. He has been in the life sciences industry for over 25 years, having held leadership positions in Sales, Marketing and Strategic Planning at BioReliance (Merck KGaA), Serologicals Corp. (Millipore), and Life Technologies. Mr. Garrett has a Masters in Experimental Pathology from the University of Washington (Seattle) and a Bachelor of Science degree from Duke University.

Mark Bibi joined the Company as General Counsel & Secretary upon the closing of the Envigo Acquisition on November 5, 2021. Mr. Bibi joined Envigo in 2002 and became Secretary and General Counsel of Envigo in August 2005. He served as Executive Vice President, Secretary and General Counsel of Unilab Corporation, a Philippine pharmaceutical company in the 1990s. Prior thereto, Mr. Bibi was affiliated with the New York City law firms, Schulte Roth & Zabel and Sullivan & Cromwell. Mr. Bibi received his Juris Doctor degree from Columbia Law School.

Investor Information

We file various reports with, or furnish them to, the Securities and Exchange Commission (the “SEC”), including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to such reports. These reports are available free of charge upon written request or by visiting www.BASinc.com/invest. Inquiries from shareholders, security analysts, portfolio managers, registered representatives and other interested parties including media inquiries should be directed to:www.inotivco.com/investors.

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BASi Investor Relations,
Attn: Jill Blumhoff
2701 Kent Avenue, West Lafayette, IN 47906 USA
Phone 765-463-4527, Fax 765-497-1102, ir@basinc.com​

ITEM 1A - RISK1A-RISK FACTORS

Risks Related to Our Business

Our business is subject to many risks and uncertainties, which may affect our future financial performance or condition. If any of the events or circumstances described below occur, our business and financial performance or condition could be adversely affected, our actual results could differ materially from our expectations and the market value of our stock could decline. The risks and uncertainties discussed below are not the only ones we face. There may be additional risks and uncertainties not currently known to us or that we currently do not believe are material that may adversely affect our business and financial performance.

Risks Related to the COVID-19 Pandemic

Our business, results of operations, financial condition, cash flows and stock price have and may continue to be adversely affected by pandemics, epidemics or other public health emergencies, such as the recent outbreak of COVID-19.

Our business, results of operations, financial condition, cash flows and stock price have and may continue to be adversely affected by pandemics, epidemics or other public health emergencies, such as the recent international outbreak of COVID-19. In March 2020, the World Health Organization characterized COVID-19 as a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. The lossoutbreak has resulted in governments around the world implementing stringent measures to help control the spread of the virus, including quarantines, “shelter in place” and “stay at home” orders, travel restrictions, business curtailments, school closures, and other measures. In addition, governments and central banks in several parts of the world have enacted fiscal and monetary stimulus measures to counteract the impacts of COVID-19.

Among other impacts to date, we believe the outbreak has and may continue to negatively impact demand for our products, including Culex, in-vivo sampling systems. We had clients delay or postpone some large Service segment programs in the year, and we estimated that the impact on revenue in fiscal 2020 from program delays and postponements was approximately $2.0 million. There was no significant impact from program delays and postponements in fiscal 2021. The measures the Company has and may continue to take in response to the outbreak may also impact our business. In response to the outbreak the Company applied for and was granted a Paycheck Protection Program loan (the “PPP Loan”) in the aggregate amount of $5,051,282. On July 16, 2021, $4,850,665 of our key personnel could adversely affect our business.

Our success depends to a significant extent uponPPP Loan was forgiven. The portion of the effortsPPP Loan that was not forgiven, and any further borrowings, may result in increased leverage and interest expense. In

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addition, the pandemic has prompted the adoption of additional safety protocols, periods of remote operation for certain of our senior management teamemployees and other key personnel. The loss of the services of such personnel could adversely affect our business. Also, because of the nature of our business, our success is dependent upon our ability to attract, train, manage and retain technologically qualified personnel. There is substantial competition for qualified personnel, and an inability to recruit or retain qualified personnel may impact our ability to grow our business and compete effectively in our industry.

We rely on third parties for important services.

We have historically depended on third parties to provide us with services criticaladjustments to our business including without limitation transportation services. In addition, in September 2016, the Boardpractices.

The outbreak of Directors engaged,COVID-19 and wepreventive or protective actions taken by governmental authorities may continue to rely on the services of, a financial consultant. The failure of third parties to adequately provide needed services or our determination to forgo non-critical services, could have a material adverse effect on our business.and our customers’ and suppliers’ respective operations, including with respect to the potential for business shutdowns or disruptions. The extent to which COVID-19 may continue to adversely impact our business depends on future developments, which are highly uncertain and unpredictable, depending upon the severity and duration of the outbreak and the effectiveness of actions taken globally to contain or mitigate its effects. Future financial impact cannot be estimated reasonably at this time, but may materially adversely affect our business, results of operations, financial condition and cash flows. Even after the COVID-19 pandemic has subsided, we may experience materially adverse impacts to our business due to any resulting economic recession or depression and demand for our products and services. Additionally, concerns over the economic impact of COVID-19 have caused extreme volatility in financial and other capital markets which has and may continue to adversely impact our stock price and our ability to access capital markets including to refinance existing obligations. To the extent the COVID-19 pandemic adversely affects our business and financial results, it may also have the effect of exacerbating many of the other risks described herein or other risks not presently known to us or that we currently deem immaterial.

Risks Related to the Industries we Serve

We have experienced periodsdepend on the pharmaceutical and biotechnology industries.

We believe that due to the significant investment in facilities and personnel required to support drug development, pharmaceutical and biotechnology companies look to outsource some or all of lossesthose services. By doing so, they can focus their resources on our operating activities.

Throughout our history we have experienced periodstheir core competency of financial lossesdrug discovery, while obtaining the outsourced services from a full-service provider like us. Our revenues depend greatly on the expenditures made by these pharmaceutical and financial hardship. Our current efforts may not resultbiotechnology companies in profitability, or if our efforts resultresearch and development. In some instances, companies in profits, such profits may not continue for any meaningful period of time. Inthese industries are reliant on their ability to raise capital in order to financefund their research and development projects and to compensate us for services rendered. Accordingly, economic factors and industry trends that affect our clients in these industries also affect our business. If companies in these industries were to reduce the Company’s acquisitionnumber or scope of Seventh Wave Laboratories, LLC’sresearch and development projects they conduct or outsource, our business and the expansion of BAS Evansville’s facilities, we have significantly increased our leverage. Sustained losses may result in our inability to service our financial obligations as they come due, including the additional indebtedness we have incurred to support our growth initiatives, or to meaningfully invest in our business.

could be materially adversely affected.

A reduction in research and development budgets at pharmaceutical and biotechnology companies may adversely affect our business.

Our customersclients include researchers at pharmaceutical and biotechnology companies. Our ability to continue to grow and win new business is dependentdepends in large part upon the ability and willingness of the pharmaceutical and biotechnology industries to continue to spend on research and development and to purchase the products and outsource the services we provide. Fluctuations in the research and development budgets of these researchers and their organizations could have a significant effect on the demand for our products and services. Research and development budgets fluctuate due to changes in available resources, mergers of pharmaceutical and biotechnology companies, spending priorities and institutional budgetary policies.policies, among other reasons. Our business could be adversely affected by any significant decrease in life sciences research and development expenditures by pharmaceutical and biotechnology companies. Economic factors, and industry trends and global pandemics, such as COVID-19, that affect our customersclients in these industries also affect our business.

Risks Related to our Operations

We rely on a limited number of key customers,clients, the importance of which may vary dramatically from year to year, and a loss of one or more of these key customersclients may adversely affect our operating results.

Four customersFive clients accounted for approximately 32%20.5% of our total revenuesales in fiscal 20182021 and eight customers accounted for approximately 49%23.2% of our total revenuessales in fiscal 2017.2020. The loss of a significant amount of business from one or more of our major customersclients would materially and adversely affect our results of operations until such time, if ever, as we are able to replace the lost business. Significant customersclients or projects in any one period may not continue to be significant customersclients or projects in other periods. In any given year, there is a possibility that a single pharmaceutical company may account for a significant percentage of our

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total revenue or that our business may be dependentdepend on one or more large projects. Since we do not have long-term contracts with most of our customers,clients, the importance of a single customerclient may vary dramatically from year to year as projects end and new projects begin. To the extent that we are dependent on any single customer,client, we are indirectly subject to the risks faced byrelated to that customerclient, including if such risks impede the customer'sclient’s ability to stay in business andor otherwise to make timely payments to us.

We operate in a highly competitive industry.

The CRO services industry is highly competitive. We often compete for business not only with other CROs, but also with internal discovery and development departments within our client companies. The industry has historically been diverse with more than 1,000 CROs around the globe, ranging from small, regional niche laboratories up to global comprehensive service providers with tens of thousands of employees. As a result of competitive pressures, our industry experienced consolidation in recent years. This trend is likely to produce more competition among the larger companies for both clients and acquisition candidates. Offshore CROs have provided increasing competitive pressures, although we believe the pandemic has made Asian CROs a less attractive option for many western clients.

The majority of our customers’clients’ contracts can be terminated upon short notice.

Most of our contracts for CRO services are terminable by the customerclient upon 30 days’ notice. CustomersClients terminate or delay their contracts for a variety of reasons, including but not limited to: